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Wendy Sanders McDonlad

Expert Advise on Tax/ Legality/ Nationality US production filming in Canada with Chinese Director

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Posted (edited)

Say, An American Film Production, funded by overseas investment,with a Chinese Director/ Writer,/ Producer to film in Canada with solely Canadian Actors and Crews, with the exception of Chinese national. 

1) Is this legally allowed? How are taxation involved. Obviously, on the US side, the American Production company do not pay taxes for the Canadian Crew nor the Chinese Director. As according to the IRS, they are aliens providing a service outside the US. But, is the production company( without a Canadian branch), obligated in anyway for the foreign crew? As far as hiring process goes, since there is no W-2 to provide.... 

2) Let's say this project is called Movie A. Now what is the nationality attribute for Movie A? US, Chinese, Canadian, if it were to be submitted to film festivals. Does it qualify a US submission, say for Sundance or TIFF respectively? As far as Sundance goes,  their guideline says it has to be funded at least 50% within the US. Ok. the film production is in the US, but donations are from overseas, so how does it work? Does this imply if a Hollywood movie funded by the bank who then got their investment from Saudi Arabia or China won't be considered an American Film?

I'm further confused at this because  

A) Kristof Kieslowski's Three Colors: Red, was considered a Poland/Switzerland film (Golden Globe 1995). However, France's Ceasar Award considered all this Three Colors movies as French Films( Or did they not submitted as Poland under the foreign category I don't know) 

B) Similarly, Michael Haneke's film Amour 2012 was nominated as an Austrian FIlm, by the Academy Awards, with mostly french funding, 100% french actors, but Austrian Director. 

In this case, is Move A considered a Chinese film?

Is the nationality of a film completely depends on the individual festival/ award organizer? 

Edited by Wendy Sanders McDonlad

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In terms of finance there are certainly potential employment and taxation rules that you should follow when staging an international production with an international crew.

On a low/no budget indie - working with volunteers on a collaborative project  could be a way to side step some red tape. Making a film in Canada with friend's potentially working for free, is not going to trigger the Feds. Of course i would never recommend that people aren't paid for their work or tax is dodged (but i'm aware it happens).

Whatever you do make sure you have sufficient insurance cover, particularly important for cross border work. 

Festivals themselves don't care what you did or didn't pay the cast and crew - thousands of films made with unpaid cast and crew have been screened in festivals. If you pay your cast and crew cash off books (which we know is naughty), festivals aren't going to audit your books and they don't care. 

What they do care about is they can show the film without getting sued, so the will want to know all the actor, location and music release forms are in place. E.g you own the rights to the performances in the production. Actors/contributors can of course sign a release even if money doesn't change hands and that would be enough for most festivals. Festivals typically don't ask to see all these release forms (imagine the paperwork)- but you will be asked to sign a form to indemnify that you have them and if any problems come out of the woodwork they are your problems not the festivals.

In terms of location of production as you say it can get a bit messy when its crew from one place, money from another and shot somewhere else. You could just list the 1 or 2 key areas and make it an international production.  E.g the 1 or 2 places most of the work happened.

Country of origin matters for festivals and competitions because they often have different categories that are open to different films depending where it came from. It's a benefit  to have a film from 2 countries e.g USA and CAN - because then you probably could submit to both USA competitions and CAN competitions... double the chances.

Different festivals and comps will have different rules about where they draw the boundary, but you can always talk to them first to check eligibility most are helpful. I was able to submit a film into a regional competition because the director was from the region even though 100% of the production + crew happened elsewhere. I just called the festival explained the films background and they told me it was fine to submit...so you can always check.

In the Academy Award example for Armour - (as I understand it) countries can only put forward one feature for consideration for the best international film. So if France had already picked a film to submit and it wasn't Armour,  then it couldn't also be submitted as a "French" film.  No doubt the production company played up its Austrian credits, to give it a chance by submitting as an Austrian film.  Rules are stretched all the time earlier this year "Bait" won the Bafta for "outstanding debut" - yet its not Mark Jenkins first feature, just the first one that got wider notice. 

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